This was an “interesting meeting, because even with the government in caretaker mode, there was a concern to pay attention to the needs of businesses,” highlights Armindo Monteiro, adding that besides the Minister of Economy, the meeting also included the participation of the Finance Minister “because the tax component is very important.”
“There was an emphasis on having a strong ‘task force’ to devise a robust and comprehensive plan, and in that sense it was beneficial, as we must respond to this in a very concerted manner because the challenge is significant,” he argues.
In terms of concrete measures, Monteiro points out that “there was an immediate joint reaction from Europe,” highlighting the need for “diplomacy and negotiation, as with any conventional or commercial war.”
On the national level, the necessity to reinforce credit insurance plans for exports was identified, considering the pre-existing need for the internationalization of the Portuguese economy, he asserts.
“We need to increase the value of exports and diversify the target markets,” he reiterates, suggesting support should be considered for the diversification of markets and for credit and insurance lines in export activities.
Regarding VAT, Armindo Monteiro states that CIP is not in favor of the zero VAT basket, because “the State should not choose the Portuguese diet; VAT applies to a very restricted group of products and is not socially acceptable since it incentivizes both those with and without purchasing power.”
“We are more in favor of measures that do not harm the industry,” he points out, suggesting that “to increase and stimulate internal demand, one way would be to reduce the VAT from the maximum to the reduced rate and apply it to all products.”
The Ministry of Economy is set to hold meetings with 18 business associations from various sectors today through Wednesday to assess “the impact and mitigation measures” of the tariffs announced by U.S. President Donald Trump last Wednesday, which involve a 20% tariff on products imported from the European Union, in addition to the 25% tariffs on the automotive, steel, and aluminum sectors.
Trump’s new tariffs are an attempt to bolster U.S. industry while penalizing countries for what he claims are years of unfair trade practices.
The new tariffs have been imposed by the United States on all imports, with surcharges for countries deemed particularly hostile to trade.
